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Nortel warns on 1Q
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March 27, 2001: 5:31 p.m. ET
Nortel warns of 1Q losses greater than expected, 5,000 extra job cuts
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NEW YORK (CNNfn) - Nortel Networks Corp. warned Tuesday that it expects to post a wider-than-expected first-quarter loss, in the range of 10 cents to 12 cents per share, and will cut an extra 5,000 positions.
Earnings tracker First Call had expected Nortel to post a 4 cent loss in first quarter.
Toronto-based Nortel (NT: Research, Estimates) now anticipates first-quarter revenue of $6.1 billion to $6.2 billion, down from $6.3 billion it had announced in February.
The news caused Nortel's shares to plunge in aftermarket trading on Instinet, dropping $1.76, or nearly 12 percent, to $15.
 In February, Nortel announced it would lay off 10,000 employees through streamlining and realignment activities. The telecommunication equipment maker boosted that number Tuesday to 15,000 and plans to complete the additional 5,000 reductions by mid-year, a spokesman said.
Nortel continues to feel the pinch of the economic downturn in the U.S. that is also causing customers globally to assess the effect on their businesses, the company said.
"Reduced and/or deferred capital spending and increased pricing pressure are resulting in lower overall revenues, particularly in the United States," said Nortel CEO John Roth.
In January, Nortel announced that it would lay off about 4,000 full-time employees in the near term but expected to finish 2001 with the same number of employees it had last year.
Nortel said it has completed the 10,000 reductions announced in February and expects to see the full benefit in second quarter.
Nortel declined to give further guidance for the fiscal year. First Call anticipates the company will post a 61 cent EPS for fiscal 2001. 
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